"Sec. 1   RCW 90.48.037 and 1991 c 200 s 1102 are each amended to read as follows:
     (1) The department, with the assistance of the attorney general, ((is authorized to)) may bring any appropriate action at law or in equity, including action for injunctive relief, in the name of the people of the state of Washington as may be necessary to carry out the provisions of this chapter or chapter 90.56 RCW.
     (2) The department, with the assistance of the attorney general, may consider the option of an innovative settlement agreement in lieu of appeal for all violators of this chapter or chapter 90.56 RCW except in cases of:
     (a) Criminal violations;
     (b) Cases where the violation is not corrected; or
     (c) Violators who have unpaid penalties under this chapter or chapter 90.56 RCW.

NEW SECTION.  Sec. 2   A new section is added to chapter 90.48 RCW to read as follows:
     (1) The department may consider an innovative settlement agreement in lieu of appeal prepared by violators of this chapter or chapter 90.56 RCW who choose not to appeal the penalty. Nothing in this section restricts the department's ability to enter into innovative settlement agreements after the appeals process has begun.
     (2) An innovative settlement agreement in lieu of appeal must meet the following standards:
     (a) The request to proceed must be made within thirty days after the date of receipt of the notice imposing the penalty, or thirty days after the date of receipt of the notice of disposition of the application for relief from penalty;
     (b) The agreement must be agreed upon with the department within ninety days after beginning the settlement process, however:
     (i) The ninety-day timeline may be extended to one hundred twenty days by mutual agreement;
     (ii) If the agreement is not agreed upon within one hundred twenty days, the penalty becomes due and payable;
     (c) The agreement must be completed within two years;
     (d) The agreement cannot be for projects currently required under any federal, state, or local law or regulation;
     (e) The agreement must be within the same watershed where the violation took place;
     (f) The agreement must not directly benefit the violator individually;
     (g) The total monetary or in-kind payments must be equal to the assessed penalty;
     (h) Twenty percent of the assessed penalty must be deposited into the coastal protection fund, created in RCW 90.48.390;
     (i) All publicity occurring as a result of this project must cite the penalty assessed and the resulting innovative settlement agreement; and
     (j) No portion of the penalty money, in-kind contributions, or project may be tax deductible as a charitable contribution."